Auto manufacturers to develop greener, compact cars

Apnaloan.com Research Bureau

06 Jun 2008

Auto manufacturers are
looking at a major transition in the auto industry by developing greener and
more compact cars. This is in a bid to combat the on-going surge in the fuel
prices and to stay competitive in the budget-conscious market.

Tata Motors has announced
to introduce a petrol-electric hybrid version of Indica. Maruti Suzuki is also
set to launch an LPG (liquid petroleum gas) version of its popular model M800.
This is over and above the company's LPG variant of Wagon R.

Even Mahindra & Mahindra
had unveiled a diesel-electric hybrid version of Scorpio at the recent Auto
Expo in New Delhi.

These efforts of the
manufactures will go to waste if they are not padded up with government
support. An excise duty cut on hybrid vehicles from 24 per cent to 14 per cent
is the step in this direction. Analysts feel that there is a need for further
reduction in excise and import duties on all such vehicles and related
components on such vehicles. This is to make them more price-competitive.
Automobile manufacturers need to look beyond hybrid-electric and plug-in
electric vehicles citing the staunch electricity crisis.